Singularity Future Technology Ltd. (SGLY) Made False and Misleading Statements Regarding its CEO’s Adverse Background, Related Party Transactions, and Inadequate Internal Controls
A shareholder filed a class action on behalf of all investors who purchased or otherwise acquired Singularity Future Technology Ltd. (NASDAQ: SGLY) securities between February 12, 2021 and November 17, 2022, for violations of the Securities Exchange Act of 1934. Singularity is engaged in blockchain supply management.
According to the complaint, on May 5, 2022, Hindenburg Research issued a report about Singularity asserting that the “Company’s CEO Is A Fugitive, On The Run For Allegedly Operative A Massive Ponzi Scheme.” The report alleged that defendants failed to disclose: (a) CEO Yang Jie had an outstanding arrest warrant in China, committed forgery, and was the largest shareholder and VP of Finance for a Nasdaq-listed lending company, CCC, which failed after reporting massive losses; (b) material related party transactions with SOS and Rich Trading; (c) independent director John Levy’s tenure as a director of CCC; and (d) the Company lacked adequate internal controls, which resulted in investigations by the U.S. Attorney’s Office for the Southern District of New York and the SEC, as well as possible delisting by NASDAQ. On this news, Singularity’s stock fell over 40%, to close at $4.80 per share on May 5, 2022, and another more than 13% on May 6, to close at $4.24 per share.
On May 24, 2022, the Company received a delinquency notice from Nasdaq due to a delay in filing its Quarterly Report on Form 10-Q for the quarter ended March 31, 2022. Nasdaq gave Singular 60 days to submit a plan to regain compliance. Despite submitting a plan, Nasdaq determined it was insufficient. Following the Company’s disclosure on October 7, 2022, its stock fell over 11%, to close at $2.29 per share.
Then, on November 16, 2022, the Company disclosed governmental investigations related to the claims raised by Hindenburg Research on May 5, 2022, and other related matters. As a result, the Company’s stock fell another almost 23% on November 16, and then fell almost 85% on November 17, 2022, to close at $1.13 per share.
What Now: Shareholders who acquired shares of Singularity Future Technology Ltd. between February 12, 2021 and November 17, 2022, must file their papers to be appointed lead plaintiff for the class by February 7, 2023. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.